Former water authority clerk pleads not guilty to embezzlement charges

A former clerk for the Southeastern Connecticut Water Authority who is accused of embezzling $44,478 to pay bills pleaded not guilty Tuesday when she made her first appearance in the New London court where major crimes are heard.

Stephanie Hodge, 48, of Groton was charged Jan. 17 with first-degree larceny after turning herself in to state police. She is free in lieu of a $150,000 nonsurety bond.

At her appearance in court, Judge Hillary B. Strackbein appointed attorney Peter E. Scillieri from the public defender’s office to represent Hodge and continued the case to Feb. 21.

According to an arrest warrant affidavit in the case, the authority hired the Cohn Reznick accounting firm to conduct a forensic audit after a routine audit showed a large variance in accounts receivables. The firm concluded that for some cash payments received by the water authority, there was a corresponding adjustment made to an inactive water account.

Confronted by a detective from the Eastern District Major Crime Squad, Hodge, who had worked as a customer clerk for the water company since 2003 and done all of its billing, admitted she had taken money to pay for a car repair with the intent of putting it back, but then “the bills kept coming and everything snowballed.” She said she would take money from a customer and pay it to their account, then charge inactive accounts to balance the transactions. The customer received credit for payment, but deposits were not credited to the authority’s bank account. Hodge told the detective she did return some of the money.